Monday, September 19, 2016

Inclusionary Zoning: Help or Hindrance to Affordable Housing?

Joe Cortright, a panelist at this month's Urban Land Institute forum on inclusionary zoning, had this to say about whether it actually works as a solution:

"...despite the enthusiasm among legislators and housing advocates for inclusionary zoning, there’s precious little evidence that it’s had a meaningful impact on alleviating the shortage of affordable housing in major US cities.  As we’ve reported at City Observatory, at least to date, these programs have produced remarkably few units in some of the nation’s largest and strongest real estate markets.

The bigger concern about inclusionary zoning is that it tends to drive up the cost of building new housing, thereby restricting supply, and actually aggravating market-wide affordability problems. While the comparative handful of new units set aside for low or moderate income households are visible, there is an invisible cost in the form of units not built, and consequently, higher market rents for everyone. Whether, and how much, inclusionary zoning drives up costs is a subject of intense debate." Read more.